All of the following are advantages of issuing stock EXCEPT that it:
A)creates no liabilities for the corporation.
B)creates no interest expense which must be paid.
C)generally results in a higher earnings per share.
D)is less risky to the issuing corporation.

Question

Quizplus · Accepted Answer

Issuing stock may result in dilution of ownership, which could result in a lower earnings per share. The other options are advantages of issuing stock: it creates no liabilities, no interest expenses, and is less risky compared to issuing debt.

All of the Following Are Advantages of Issuing Stock EXCEPT